Chile could be heading for its worst year of copper production in more than two decades, as extreme weather and operational setbacks weigh on the world’s largest copper producer.
Speaking at an event this week, Finance Minister Jorge Quiroz warned that the country’s copper output could fall by 8–9% in 2026, a sharper decline than previously expected.
The latest projection compares with the roughly 7% drop Quiroz forecast last month, highlighting the worsening outlook for Chile’s mining industry.
It is also significantly more pessimistic than the 2.6% decline forecast by state copper agency Cochilco, although both expect production to recover in 2027.
According to Quiroz, Chile’s copper mines have been hit by deadly accidents and severe storms in recent months, compounding existing operational challenges.
He also blamed years of weak investment for leaving the industry poorly prepared for declining ore grades, saying uncertainty over mining policies and taxes had discouraged spending.
Investment challenges
Chile’s production difficulties highlight the broader challenges facing the global copper industry, where ageing mines, falling ore grades, and lengthy permitting processes have made it increasingly difficult to bring new supply online.
According to S&P Global, the average time between a copper discovery and the start of production has reached 17.5 years, reflecting the industry’s persistent development and regulatory challenges.
While Quiroz notes that a record number of mining projects are now entering Chile’s investment pipeline, with the government also seeking to accelerate permitting, these projects are unlikely to provide immediate relief.
Moody’s recently noted that Chile is undergoing an investment cycle focused largely on sustaining production and replacing depleted reserves as its major copper deposits mature.
Chile’s worsening outlook adds to a series of production setbacks at mines around the world, raising the possibility of the first annual decline in global mined copper output since 2017.
Write to Jackson Chen at Mining.com.au
Main Image: Codelco
